Thread by @TraderL1z

𝑸: 𝐈 𝐡𝐚𝐯𝐞 𝐭𝐡𝐞 𝐛𝐞𝐬𝐭 𝐭𝐫𝐚𝐝𝐢𝐧𝐠 𝐬𝐭𝐫𝐚𝐭𝐞𝐠𝐲, 𝐬𝐨 𝐰𝐡𝐲 𝐚𝐦 𝐈 𝐥𝐨𝐬𝐢𝐧𝐠 𝐭𝐫𝐚𝐝𝐞𝐬?

Unlock the secrets of successful traders! Discover how top traders manage their trades and think to avoid losses. #Crypto #trading 💡🧵
👇👇👇

The main reason you're not having the outcomes you want as a trader is your nature to avoid pain. Most play this game called life within the boundaries built by avoiding pain and anxiety.

One of the most vital keys to success isn't having a high IQ, the best indicator, or the best strategy; it's your psychology and being specific, your perspective on pain.

Research has shown that we experience a financial loss as being 250% more intense than a financial gain.

And you know what's even crazier?

The loss doesn't have to be real. It can be in your mind and yet be just as powerful. That's why people will do anything to end the pain.

It's the pain of losing what you gained after the market went in your favor that makes you take the profit early.

Giving in to the pain, the average trader closes half their position, telling themselves it's part of the plan. Their pain subsides, and they feel better.

The pain of losing that tells you to add to your losing position in the hope that the loss will turn into a win.

Remember that whether the loss is real or virtual, the pain receptor is activated.They didn't exit the position because of a signal from the market.

They left because of a signal from their emotional brain. So who is responsible for the pain you experience when trading?

your reptilian brain.

Whether you want it or not, your subconscious reptilian mind is there to defend you and when you are in a certain position, you feel a wobble in your stomach and a vibration in your lower back, your reptile mind is preparing you for survival by inducing a fight or flight reaction

And here lies the issue: in order to be a great trader, you must go against nature. This implies you'll have to accept, defeat and battle your subconscious protective mechanism.

A system that protected you as a caveman will not protect you as a trader. Unless you learn how to conquer it.

How?

RUN TOWARD THE DANGER.
While the majority look to run from pain, I do just the opposite. I run toward it.

When the majority of traders are trading their account sizes and getting emotional, I trade the market. because I understood the size of my profit was irrelevant to the market.

The top traders are subject to the same built-in automatic pain receptor as the average trader, but the difference lies in how they handle the pain. Instead of giving in to it, instead of being ruled by their emotional responses, they have trained themselves to expect the pain.

They're aware of the pain. They don't ignore it, they accept it.

Perhaps the market will continue to rise. Maybe it doesn't. It makes no difference since the top traders are molded by their continual process, not by the outcome.

They understand that the probability of a single trade outcome is not the same as the probability of a process of trades (at least 100 trades).

They understand if they focus on the process, the outcome will take care of itself.

What if the market takes some of the profits away?

The top traders understand that pain is a natural instinct, a part of the mind that exists to protect them and ensure their survival.

They are not vulnerable to their in-built emotional safety switch when the market advances in their favor, they do not take their profit by abandoning all or a part of their position as the average do.

Instead, they strengthen their position. If the market is rising and they are long, they will purchase more. They sell more short if the market is falling and they are short.

The pain grows as the market goes more in their favor, their protective thinking pushing them to take profit, but they turn the switch, conscious of the suffering and the implications of making decisions based on pain.

They enlarge the position rather than abandoning it totally/partially.

Repeat after me: You can go broke taking a profit.

Wanna know how 95% of the traders react to losing positions ?

Outside of trading, your mind searches for deals in everyday life. Marketers are aware of this and will lure you with unique offers. You enjoy saving 25%. It may work in a supermarket.

Thinking in this approach, the average traders tend to buy more. However, the "supermarket effect" does not apply in the trading industry.

With the average traders thoughts controlled by the fear of the pain caused by taking a loss, all they can think about is how they'll feel if they sell now, just as the market is about to hit a low and turn upward.

In contrast, the most successful traders purchase. The market falls. Their brain urges them to buy again, but they don't.

They understand this reaction and have learnt to deal with it since they are aware of the "supermarket effect," pain receptors, and their endocrine system pumping adrenaline and cortisol, ready them to battle and combat stress.

The top 5% realize that financial markets are not like supermarkets, and they have no record of previous pricing; instead, they recognize that supply and demand influence the price. Just because the price of something has dropped does not make it inexpensive.

And if the position is losing, they accept the loss and close thiere position.

Remeber: Everything in the market is priced-in.

Other issue you need to fight.

1/ Hopium effect:

Because the market was falling precipitously, it seemed inexpensive. 95% were buying.

They had a lot of fun figuring out how to get to the #bottom of a move.

Because the market was increasing rapidly, it looked to be expensive. 95% of people were selling short. They couldn't understand the concept of buying.

95% were joining an existing trend, but their decision was motivated by seeing prices move without them. The only way to stop their pain was to enter at any cost.

Trading in this manner destroys accounts.
Hope is not a strategy!

2/ Overconfidence:

When one trade after another fails, you'll need all of your confidence. Remember, if you start right and assume you're wrong, you'll avoid the continual conflict and confidence-sapping grind that 95% of traders go through.

However, as I discovered the hard way, my most vulnerable periods were not when I was at my lowest. I was most vulnerable when I was overconfident, which was generally shortly after a huge winning deal.

My worst losing streaks generally followed significant winning streaks. Confidence is a wonderful thing. Overconfidence causes you to disregard important brain messages.

3/ Boredom:

In summary, many individuals feel bad when they do nothing. When the market opens, people believe they must be productive and accomplish something so they end up taking the unprepared trades.

The market does not pay on an hourly basis. A large part of trading success comes from. So learn how to stay calm and when to take trades.

⭐️THE 4 SECRETS THAT ENHANCED MY #TRADING PERFORMANCE⭐️:

1: I assume I am wrong until proven otherwise.
2: I expect to be uncomfortable.
3: I add when market proves my position correct, and I subtract when wrrong.
4: Using Zen buddhism as a way of thinking

To sum all what I've said, As a consistent, successful trader, you will be constantly in conflict with your own protection systems. You'll have weaknesses, and trading is where you'll discover what they are. Accept them and strive to eliminate them.

Success is not discovered by gazing at charts for 30,000 hours; it is not found in software, no matter how costly; it is not found in newsletters, indicators, or conferences.

Accepting that we all feel pain when putting money at risk, giving up control, and attempting to be correct are all ways to find it. You may neutralize the hostile emotions that steal so many of success by assuming you are wrong and not right when you enter a position.

Fear, optimism, boredom, overconfidence are all lurking in the shadows, ready to catch the unprepared. Instead, success is found within by controlling your emotions and embrassing pain.

⭐️I wish you the best of luck. ⭐️

𝐆𝐢𝐯𝐞 @TraderL1z 𝐚 𝐟𝐨𝐥𝐥𝐨𝐰 𝐢𝐟 𝐲𝐨𝐮'𝐯𝐞 𝐠𝐨𝐭𝐭𝐞𝐧 𝐯𝐚𝐥𝐮𝐞 𝐬𝐨 𝐟𝐚𝐫!

Stay ahead of the game by following me! My next thread is packed with valuable insights and strategies that will take your #trading and #crypto skills to the next level.

👇👇👇
open.substack.com/pub/l1zle/p/ma…